Quantitative Investing Trading Screeners
What Is Quant Investing and Trading?
Investing features many ways to make and -- unfortunately -- lose money. Finding ways to maximize investment gains while minimizing downside risk is one of the ultimate goals of the investor, and there are several well-recognized approaches to this process. One is quantitative investing, a strategy that uses detailed statistical models to differentiate stocks.
Statistical analysis of the world's economies and stock markets moved from academic abstraction to Wall Street reality during the second half of the 20th century, as computers became more powerful and less costly. Most investment management firms use this kind of quantitative analysis to inform their decision-making process, but "quant investing" as a distinct style places stat analysis front and center. Quant investing attempts to reduce the process to its scientific and statistical core, eliminating emotional, fallible human judgment from the equation as much as possible.
Constructing the Models
The actual "product" of a quant investment firm isn't the portfolio itself, but the software model that guides their investment decisions. Market-savvy programmers -- or code-savvy investors -- create these by sifting through huge quantities of stock and trading data, in search of patterns. Once a promising pattern is identified, the programmers will create an algorithm to track those factors and assess the optimal time to buy and sell a given security. The code must be tested rigorously under simulated market conditions and with live data, before it's put into use as an investment tool.
Approaches to Quant
Some quant funds and institutional quant investors take what's referred to as a "black box" approach. In this style of investing, the computers can make trades without direct human supervision. It's especially well suited to arbitrage, in which high-speed trades can be conducted in huge volumes to profit from minor fluctuations in the value of stocks. Other managers use quantitative analysis as a way to create a real-time "shortlist" of securities worthy of their consideration. The manager then chooses among these investments through additional research, personal experience or other factors.
The Bottom Line
A study of quantitative and traditional strategies performed by Karl Mergenthaler of J.P. Morgan Investment Analytics demonstrated that, on the whole, quant investing can work well. The Sharpe ratio for quant investment strategies -- a measure of return vs. risk -- showed quant investment outperforming conventional investment on large- and mid-cap stocks, and remaining competitive in small-cap stocks. Quantitative funds also demonstrated lower management costs, in part because of their automated nature and correspondingly low salary requirements. Stable and predictable markets work best for quant investing, allowing statistical models to generate steady gains. During volatile markets, such as the 2008-09 recession, traditional investing has outperformed quant investing.
By Zacks Investment Research
Click the Links Below to Review Quantitative Investing Trading Screeners Software and Advisories
Quantpedia Screener and The Encyclopedia of Quantitative Trading Strategies
Choose your trading strategy from simple to very complex. From short-term to long-term. Equities, bonds, commodities or FX. We extracted explicit trading rules in plain language along with performance and risk characteristics and descriptive classification information. You can screen categorized data, see transparent visualizations, and examine related strategies. Avail of free and premimum Quantpedia services.
QuantShare Trading Software for Stock Forex Futures Traders
QuantShare is for traders and investors who want to: Analyze data and perform quantitative research. Create neural network trading models. Create and analyze charts, studies, indicators. Create and backtest trading strategies. Create watchlists and screens. Download and import trading data. Create portfolios and generate buy and sell signals. QuantShare is suitable for all levels of traders and it works with U.S. and International markets. It is not only a stock trading software. It can be used by Forex, Futures, Options and ETFs traders.
FINVIZ Quantitative Stock Screener Elite
Finviz provides leading financial research data, analysis and visualization, and offers the fastest and the most advanced stock screener available online, interactive markets maps, innovative market analysis and institutional services. Traders, individual investors and financial institutions including Pimco, Goldman Sachs, and JP Morgan use Finviz Elite. Maybe you should too to be profitable. Trade with very low-risk and high-reward using market neutral statistical arbitrage trading strategies with Finviz stock correlation data.
Invest2Success Investment Advisory Stock Picks
Free Trial - Receive daily low-risk high-reward SP500 NYSE Nasdaq buy-long and short-sell stock picks that are experiencing strong increasing and decreasing earnings, that include buy sell entry, stop-loss, take profit area price targets, and trade management information to your email inbox.
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